Kevin O’Leary, a Shark Tank TV host, says that there will be “total panic” in crypto markets before the industry moves back to stronger firms and clearer regulation.
O’Leary stated that despite the recent decline of crypto finance companies such as Voyager Digital, Celsius, and Celsius, we still miss a “real big events” in previous market cycles. He also said that the time is not right for us to return to the space’s accelerated growth.
“This passion play is played over and over again.”
Investors have blamed the current market conditions on over-leveraged central finance firms like Voyager or Celsius. O’Leary stated that the problem with firms like these is due to “idiot managers”, who need to be eliminated to make the industry more sustainable.
“It is unfortunate that these companies have gone into zero, but you end with stronger species.”
Cointelegraph interview with Ben Samaroo, CEO at crypto investment support company WonderFi Technologies. He said that the recent bankruptcies were part of the “second wave” of crypto crises in Canada’s past.
Samaroo said that Canada’s first crypto crisis was the collapse of QuadrigaCX, a cryptocurrency exchange. In 2019, $145 million of user funds disappeared after Gerry Cotten died.
WonderFi CEO, John McMahon believes that regulators will be focusing on crypto products in the second wave of crypto crises.
“Canadian regulators are taking a look at anyone offering products for earning in Canada to determine what that means.” They are looking at the rubble from the collapse to add restrictions.
According to the duo, stablecoin regulation would be another hurdle for the industry. O’Leary said unambiguously that there is a need for more stablecoins as commodities, but that they must maintain their peg.
Related: Celsius promises to come back from bankruptcy, but an expert fears a repeat of Mt. Gox
He said that the May destruction of Terra USD (UST), which resulted in the depegging was “good”, but others can’t follow the same path if it is not their desire to exist. Tether (USDT), he said, may have more problems after it fell to $0.95 in May.
Regulators will have to deal with the problem of a “tether breaking” peg as they examine what stables can be used on platforms.
USD Coin (USDC), is currently the preferred stablecoin at Bitbuy and Coinberry. Samaroo said that other stablecoins are possible to list on exchanges, provided that they don’t expose users to a “catastrophic” event from a stablecoin.
Samaroo and O’Leary seem to be focused on long-term industry growth. WonderFi was recently listed on the Toronto Stock Exchange June 20, and Coinberry, a Canadian crypto exchange, was acquired for $38.4M on July 4. It now controls Bitbuy and Coinberry in Canada.